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MUMBAI: Indian stock markets will likely stay volatile on Tuesday , with SGX Nifty trends suggesting a positive opening for domestic benchmark indices. On Monday, the BSE Sensex slipped 949.32 or 1.65% at 56,747.14 and the Nifty declined 284.45 points or 1.65% at 16,912.25.
Investors will be cautious ahead of the Reserve Bank of India monetary policy statement due on Wednesday.
Asian stocks rose Tuesday after US equities rebounded and China pledged measures to support slowing economic growth. Treasuries steadied after tumbling.
MSCI Inc.’s gauge of Asia Pacific shares gained for the first day in three as Japan climbed. Hong Kong outperformed with Alibaba Group Holding Ltd. leading a rebound in Chinese tech firms after the company announced a management shakeup. US futures edged higher. The S&P 500 wiped out last week’s losses, while the technology-heavy Nasdaq 100 also gained, aided by receding concerns about the the severity of the omicron virus variant.
Back home, InterGlobe Aviation Ltd, which operates India’s largest domestic airline IndiGo, on Monday said it will conduct an extraordinary general meeting (EGM) on 30 December, seeking shareholders’ permission to amend its Articles of Association (AoA) and remove restrictions on promoter share transfer.
Reliance Industries Ltd (RIL) has taken a $736 million equivalent green loan from five banks to fund its acquisition of Norwegian solar panel maker REC Solar Holdings, marking the first such financing for the retail-to-telecom conglomerate.
Tata Sons is considering appointing aviation industry veteran Fred Reid as the Chief Executive Officer of Air India and Nipun Aggarwal as the Chief Financial Officer, according to media reports.
Treasury yields rose sharply Monday, erasing most of Friday’s steep declines, amid corporate bond offerings. The curve steepened, reversing a trend in which expectations for Federal Reserve rate increases had buoyed short-dated yields. The dollar was steady and oil extended gains.
China’s policy makers moved to expand support for the economy Monday as a property-market downturn threatens to hamper growth. They signaled an easing of real estate curbs and pledged to stabilize the economy in 2022. The People’s Bank of China said it will reduce most banks’ reserve requirement ratio, while Premier Li Keqiang said there’s room for a variety of monetary policy tools.
Easing of monetary conditions to shore growth in the world’s second-largest economy should offer some succor for markets whipped by bouts of volatility. The faster pace of Fed tapering of its bond-buying, which will pave the way for raising rates next year to combat elevated inflation, has tested investors’ appetite for risk.
Still, investors see further turbulence ahead for equity markets. New restrictions are showing up across the world as authorities try to stem the spread of omicron.
Geopolitical tensions are also resurfacing. The U.S. and European allies are weighing banking sanctions if Russia invades Ukraine. U.S. government officials will boycott the Beijing Winter Olympics in February due to concerns about human rights abuses.
(Bloomberg contributed to the story)
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